The Gunners were believed to be interested in the 23-year-old towards the start of last year, but the Brazilian made the move to the Groupama Stadium from Athletico Paranaense on a four-and-a-half-year deal.
City boss Pep Guardiola has identified the England international as one of his primary summer targets, along with Tottenham Hotspur star Harry Kane.
The Reds have already secured the signing of Ibrahima Konate from RB Leipzig, while Joe Gomez and Virgil van Dijk are working their way back from long-term knee injuries.
According to Calciomercato, the Merseyside giants could further bolster their defensive options.
The 25-year-old has made 180 appearances for PSG in all competitions, including 40 outings during the last campaign.
Kimpembe could face a battle for his spot next term, though, following the arrival of Sergio Ramos, and according to L’Equipe, the Frenchman could consider his future away from the French capital.
The 23-year-old Fiorentina winger only joined Juve in October 2020 on an initial two-year loan deal.
However, the Italy international has been heavily linked with a summer exit, with Chelsea and Bayern Munich expressing their interest earlier in the window.